Sex.com For Sale in Foreclosure Auction

Elliot Silver
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80

Sex.com

In exactly one month from today, we may see a new record set for the price of a domain sale. I just received an email from a friend with a link to a notice stating that SEX.com will be up for auction. The foreclosure auction will be held at the offices of Windels Marx Lane & Mittendorf, LLP, 156 West 56th Street, New York, New York on March 18, 2010 at 11 am.

In order to bid on the auction, you must come prepared with a certified bank check in the amount of $1,000,000, made payable to “Windels Marx Lane & Mittendorf, LLP, as escrow agent.” The auction may be open to the public.

The auction description is as follows:

All of Borrower’s interest in and to all right, title and interest in an undivided 100% interest in the internet domain name and related INERNIC registration of the URL www.sex.com, and 100% of all cash proceeds, accounts receivable, licensing rights and intellectual property rights directly associated with or derived from the ownership of such URL.

The tale of Sex.com is actually very interesting, and a book was written about it a few years ago. The Cliff’s Notes version is that Match.com founder Gary Kremen originally registered the domain name, but it was then stolen by Stephen Cohen, and a 10 year legal battle ensued. A company called ESCOM, LLC acquired Sex.com in January of 2006, although terms of the deal were not disclosed. There was an article that pegged the sale at $14 million, but there was no confirmation that this number is accurate.

More information about the auction can be found on the David R. Maltz & Co website, and you can also download the auction notice pdf for more information. One interesting note from the auction notice is that it comes from a Dom Partners, LLC at 2050 Center Avenue (Suite 600) in Fort Lee, NJ – the same address as Domain Capital, who reportedly provided part of the financing.

.Mobi Numbers Aren’t Pretty

Elliot Silver
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34

I read the news yesterday about Affilias buying mTLD Top-Level Domain Ltd., the company that operates the .mobi domain extension. I don’t think I’ve owned more than a couple of non-premium .mobi domain names, so I haven’t followed the market, but according to an article appearing today in paidContent:UK, the .mobi numbers look fairly ugly to me.

The article references financial records for the mTLD company that were filed at Ireland’s Companies Registration Office, although there was no link to the source of those. If accurate, it’s a pretty bleak picture:

“In 2009 mTLD had a loss of €3.5 million on a turnover of €6.4 million, compared to a loss of €324,000 the year before on turnover of €9 million. Total assets less liabilities (eg money owed to creditors) in 2009 was €1.7 million.”

The article further states that there are just about one million registered .mobi domain names out of the 187 million registered domain names.

Thanks to George Kirikos for sharing the link to the article.

Correcting an Out of Context Article

Elliot Silver
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1

As I do every morning, I received a Google news alert today with the topic of domain names. The title of the article is “Expert says very few domains are worth millions,” and it was posted on GlobalGold.co.uk, “UK’s most progressive and innovative web hosting and web-based application providers for SME business today.”

Ordinarily I don’t post links to articles I believe are written poorly, but this one happened to include my opinion as the source, and the conclusion they drew was taken from a completely unrelated article. I don’t know if the article was written as SEO bait, but it got me to read it, and unfortunately, it caused me to write this post.

The article tried to juxtapose my article about the problems impacting domain auctions with the Media Post article, How Much Are Domain Names For Campaigns Worth?, in which Laurie Sullivan wrote, “Marketing and advertising agencies looking to strengthen campaigns might pay just about any price for a solid domain name if it means building a better relationship with consumers.”

The Global Globe article referenced me by writing:

Laurie Sullivan told Media Post that the most commercially attractive web addresses can sell for millions, meaning they can be prized business assets.

However, internet entrepreneur Elliot J Silver says multi-million pound transactions are the exception to the rule, as domains generally have a much lower value.

Although I do think that million dollar domain names are a very small percentage of overall domain registrations, I don’t think that this has anything to do with domain auctions, as the article further implies (“Writing in his blog, he reported that domain auctions have suffered lately due to firms being unrealistic as to the value of their addresses.”). The article was confusing to read, and it didn’t really make sense to jump to its conclusion based on an unrelated post of mine.

My opinion on valuable domain names can be found in Website Magazine’s Web Trends for 2010 article, in which I was asked for some predictions for the new year. In that article, I said  “High-value keyword names like toys.com and candy.com, which sold this past year, will continue to command high prices. Companies will continue to invest in their own businesses and will acquire high-value keyword domains names for growth and for competitive reasons.”

This puts my opinion more in line with Sullivan’s Media Post article than the Global Gold article insinuates.

Francois Makes Business Decision, Lazy Domain Investors Go Nuts

Elliot Silver
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32

Apparently Francois Carrillo of Domaining.com decided to add tech blog feeds to his website today. The result of the decision was that Domaining.com was briefly filled with non-domain related news articles. This made it difficult for domain investors to quickly find their favorite domain news and blog articles, and people publicly complained in blogs, Facebook, forums, and Twitter. That is, until Francois reversed course and took those feeds out.

I know Domaining.com has become popular because it allows people to easily find interesting domain-related news articles without having to visit a whole host of websites. I even get about 8-12% of my daily traffic from Domaining.com, so any confusion or excess articles might result in less traffic to my site. However, Francois has every right to make his own business decisions without public criticism from users who aren’t paying him a dime.

I don’t know if his business model is good (because someone may eventually buy him out) or it sucks (because it’s now a loss leader), but that’s not my business or anyone’s business.

The fact that we use and benefit from Francois’ website should not mean that we have the right to publicly criticize the guy and put him on blast when he tests things out in an effort to make some money. If you are paying for services and they aren’t what you agreed to when you signed up, you have every right to complain. When you are using someone else’s services at no cost to you, you have no right to complain.

I support the First Amendment right to free speech, but I think it’s uncalled for when people openly criticize the guy for trying to make a buck with his business. There are plenty of people who do worse things to make a buck.

Domain Investor Interviews on Domainers Digest

Elliot Silver
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0

Based on feedback I have received from people regarding my “5 With…” series of interviews, I know people love to read about how others got started and found success in the domain investment business.

Steve Kaziyev recently launched a new website, Domainers Digest, and the purpose of the site is to give people an inside look at people from all parts of the domain industry.

Today, Steve has an interview with Frederick Schiwek of EuroDNS.com, the person who sold Voodoo.com for $300,000. Over the next few weeks and months, Steve has interviews lined up with people such as Parked.com’s Jazmin Carrillo, Bill Sweetman of Tucows, John Yeomans of Edge Capital, and many other people you may know but may not know much about.

I wish Steve lots of luck with his new venture.

Just as an aside, this isn’t a paid post nor am I being compensated for it in any way.

2010 Domain Industry Predictions

Elliot Silver
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20

I was asked by the editor of Website Magazine to give some domain industry predictions for 2010 for their Web Trends for 2010 article. My quote from the article is below, but I am also interested in hearing what your predictions are for the upcoming year.

“As reported in the December issue of Website Magazine, businesses have increasing opportunities in the domains industry. Elliot Silver, president of Top Notch Domains and Silver Internet Ventures agrees. “High-value keyword names like toys.com and candy.com, which sold this past year, will continue to command high prices. Companies will continue to invest in their own businesses and will acquire high-value keyword domains names for growth and for competitive reasons,” Silver says. “With PPC revenue down and not looking like it will increase in the near future, some domain owners will make top domains available for acquisitions that haven’t been available in many years.”

In addition, the Microsoft-Yahoo! deal will affect the domain industry, according to Silver. “The Microsoft and Yahoo! deal is going to be impactful on domain name values because Microsoft’s Bing tends to rank developed keyword domain names higher than Google and Yahoo!,” he says. “Right now, impact is minimal because of Bing’s relatively low market share. With the deal, Bing will manage search results for Yahoo!, bringing the market share to 30 percent of search from around 8 percent. This is significant.”

What are your predictions for the domain business in 2010?

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